Contributors: Akin Gump Strauss Hauer & Feld LLP
Speculative Allegations Regarding Operation of Accused Website Doom Patent Infringement Complaint
by Jonathan James Underwood & Rubén H. Muñoz
District Court, Patent Infringement, 12(b)(6) Motion to Dismiss
Mar. 16, 2022
A judge in the Northern District of Georgia has granted a defendant’s motion to dismiss a patent infringement case for failure to state a claim under Rule 12(b)(6). The court found that the complaint failed to meet the pleading standards of Rule 8 under Twombly and Iqbal because the infringement allegations were only speculative as to how the defendant infringed the patent.
The patent at issue claimed a system for selling certain types of customer data using a particular type of software. The plaintiff alleged “upon information and belief” that the defendant had partnered with one or more data sellers, had set up a website that used software designed by the one or more data sellers, and that the software infringed the patent.
The court ruled that the complaint failed to state a plausible claim for patent infringement. The court explained that the plaintiff had relied upon a series of assumptions that amounted to alleging the defendant infringed the patent because the website functioned in a way that could be achieved using the software of the patent.
The court rejected the plaintiff’s argument that the complaint was sufficient, finding that the plaintiff had essentially argued that a “form complaint” was all that was needed. The court explained that such complaints were no longer sufficient because Rule 84, the authorizing rule, had been abrogated. The court further explained that a plaintiff need not plead facts showing that every claim limitation is met, but must show how the defendant plausibly infringes the patent by alleging facts that connect the conduct to the claim limitations. Because the plaintiff had only speculated as to how the defendant’s website operated to give access to customer data, and that the method of accessing the data was a critical part of the patent’s claims, the complaint was fatally defective. The court explained that the “sheer possibility” of infringement was insufficient to withstand the motion to dismiss.
The court concluded by recognizing the problem faced by a plaintiff who lacked insight into the defendant’s operations, and who would find it difficult to gain insight without civil discovery. But the court rejected the notion that a case could proceed on assumptions and allegations of similarity between products. Rather, the complaint must allege facts to raise a reasonable expectation that discovery will reveal evidence to support the claim for relief. Therefore, the plaintiff must determine first whether it has a claim.
Practice tip: The pleading standards place the burden on the plaintiff to investigate and make factual allegations that plausibly, not possibly, show a defendant infringes the patent. A complaint that makes an infringement allegation founded on a series of assumptions may be highly susceptible to dismissal under the federal rules governing the sufficiency pleadings.
DataWidget, LLC v. Rocket Science Group LLC, 20-cv-02961 (N.D. Ga. Mar. 7, 2022)
District Court Granted Summary Judgment of Invalidity Because the Patent Recited a Patent-Ineligible Abstract Idea Executed in a Generic Digital Video Camera
by C. Brandon Rash & M. Andrew Holtman
District Court, Patent Infringement, Abstract Ideas
Mar. 17, 2022
Judge Orrick in the Northern District of California recently granted a motion for summary judgment of invalidity for patent-ineligible subject matter under 35 U.S.C. § 101. The court found that the claims recited the abstract idea of creating and transmitting video at two different resolutions and adjusting the video’s setting remotely.
Contour IP Holdings, LLC v. GoPro, Inc., No. 3:17-cv-4738-WHO (N.D. Cal.).
Plaintiff Contour IP Holdings, LLC sued GoPro for infringing U.S. Patent Nos. 8,890,954 and 8,896,694. The patents are directed to point-of-view digital video cameras. A representative claim recites such a camera—generally comprising four elements: a lens; an image sensor configured to capture light propagating through the lens and produce video image data; a wireless connection protocol device configured to send image content to a portable computing device; and a camera processor configured to receive the video image data from the sensor—generates first and second image streams, receives control signals from the computing device and adjusts settings of the video camera based on the control signals.
The court analyzed eligibility using the Supreme Court’s two-step Alice framework. In step one, a court determines whether the claims are “directed to” a patent-ineligible concept, such as an abstract idea. Alice Corp. Pty. Ltd. v. CLS Bank Int’l, 573 U.S. 208, 217 (2014). If they are, the court proceeds to step two and considers “the elements of each claim both individually and ‘as an ordered combination’ to determine whether the additional elements ‘transform the nature of the claim’ into a patent-eligible application.” Id.
Addressing step one, the court cited Federal Circuit precedent stating that claims reciting a mechanical device, such as a camera, may nonetheless be directed to an abstract concept, and instructing that the analysis focuses on “what the patent asserted to be the focus of the claimed
advance over the prior art.” TecSec, Inc. v. Adobe Inc., 978 F.3d 1278, 1292 (Fed. Cir. 2020). The proffered advance over the prior art was that the device creates two video streams, one lower and one higher resolution, and transmits the lower resolution stream to a portable computing device while saving the higher resolution stream. A further stated advance is that the camera is configured to receive control signals from the computing device, which can adjust its settings.
The court found that this proffered advance is “directed to a result or effect that itself is the abstract idea and merely invoke[s] generic processes and machinery.” Smart Sys. Innovations, LLC v. Chi. Transit Auth., 873 F.3d 1364, 1371 (Fed. Cir. 2017). The abstract idea is creating and transmitting video at two different resolutions and adjusting the video’s settings remotely. The court determined that receiving, generating, storing and transmitting video are abstract concepts. The court found that the claims described the implementation in “purely functional terms” and did not recite any “technical requirements” or “particular hardware” other than the generic “lens and image sensor,” generic “wireless connection protocol device” and generic “camera processor” to execute the abstract idea.
Addressing step two, the court decided that the elements of the claim did not transform the nature of the claim into something patent-eligible because “the claim only recites functional, ends-oriented language and there is no indication that the physical components are behaving in any way other than their basic, generic tasks.” The court did not find any “additional feature” showing that the claim is “‘more than a drafting effort designed to monopolize the’ abstract idea.” Contour relied on certain Bluetooth technology disclosed in the specification, arguing that it shows “Contour had to make changes to the firmware for the processor” in a manner that had never been done before. The court, however, found that none of this is claimed, and that “Contour instead claimed a broader universe of any technology that performs its abstract idea so long as it meets the minimal criteria of its generic elements.”